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HomeFinanceMOL Group announced its financial results for Q1 2023

MOL Group announced its financial results for Q1 2023

Hungarian integrated oil and gas company, MOL Group delivered 714 million US dollars Clean CCS EBITDA in the first quarter of 2023, despite regulatory headwinds and decreasing oil and gas prices. Upstream EBITDA decreased due to decreasing oil and gas prices, the extra royalty in Hungary and the regulated gas price scheme in Croatia, said the company.

Chairman-CEO Zsolt Hernádi underlined that MOL Group delivered stable first quarter results in 2023, as normalising macro conditions were mostly mitigated by good internal performance of the divisions. “Our company reached important milestones in supporting energy sovereignty of the region, Upstream managed to increase domestic production volumes, we shipped our own crude from Azerbaijan to Europe and we continued with investments allowing our landlocked refineries to access crude oil from diverse sources. In addition, Consumer Services emerged from last year’s crisis stronger and started the operations in Poland,” pointed out the MOL CEO.

He noted that one year after the beginning of the war in Ukraine, it is clear that the economic consequences are here to stay changing the landscape of the European energy scene. “Despite the negative impact of regulatory headwinds, our integrated, resilient business model proved to be successful in this highly challenging environment, allowing us not only to continue with our diversification efforts but to stay on track with our transformational projects, as well,” he concluded.

Downstream Clean CCS EBITDA increased by 18 per cent compared to the same quarter last year and reached 299 million US dollars. Petchem’s margin remained under pressure, but refining and marketing performance was able to offset the negative drivers, despite the windfall taxation in Hungary. Motor fuel demand decreased by 14 per cent in Hungary year-on-year during the first quarter period since the price cap boosted consumption in the first quarter of last year, while demand slightly increased in Slovakia by +3 per cent and Croatia by 1 per cent. A milestone was reached in the crude diversification efforts in March when MOL Group transported Azeri light crude from its co-owned ACG field in Azerbaijan to the Slovnaft refinery in Bratislava, further supporting crude sourcing flexibility.

Consumer Services EBITDA increased by 97 per cent in the first quarter of 2023 year-on-year, driven by an improvement of the regulatory framework and the non-fuel margin increased further. Sales volume developed by 16 per cent compared to last year’s same period, supported by around 200 million litres of positive inorganic impact as a result of the Lotos acquisition in Poland. Following the expansion of the Consumer Services portfolio in Poland in late 2022, the MOL brand was launched in the country and service station rebranding is in progress. The number of Fresh Corner sites rose throughout the network to 1,172 in the first quarter of 2023, from 1081 in the first quarter of 2022.

Upstream EBITDA decreased to 283 million US dollars in the first quarter of 2023 as lowering oil and gas prices, the extra royalty levied upon production in Hungary and the regulated gas price scheme in Croatia dented the results. However, the division generated 205 million US dollars in simplified free cash flow. As a result of our relentless field development efforts production volumes increased in Hungary and in Iraqi Kurdistan. ACG entitlement was also higher due to the higher share in a low oil-price environment, bringing total production above 95 mboepd, above the production guidance. The implementation of the shallow gas drilling program continued in Hungary, 3 wells were successfully tested in the first quarter of 2023, bringing the total shallow gas well count to 19 since the start of the program, in 2019. Despite the cost pressure across the value chain, group-level unit OPEX remained below 6 US dollars/bbl in the first quarter of 2023.

Gas Midstream EBITDA reached 79 million US dollars, which rose by 64 per cent year-on-year, due to the increased cross-border capacity demands in line with higher export volumes. Decreasing gas prices and changing transmission flows had a positive impact on gas consumption cost, informed MOL.

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